Law:

Section:

Section 7 of the Estate Duty Act, 1953 - Interest ceasing on death - Deceased was enjoying possession of jahgir that was inalienable and impartible - Subsequently, before his death by virtue of statutory enactment jahgir was abolished and compensation was awarded to branch of deceased - Whether since deceased died after abolition of jahgir and vesting of estate in State Government, compensation received by him belonged to his joint family and members of his branch - Held, yes - Whether, therefore, only deceased's share in compensation awarded to his branch passed on his death under section 7(1) and not entire amount of compensation - Held, yes FACTS In 1807, the Dewan was granted the jahgir consisting of several villages. Later on, the Yalandur Jahgir Act, 1885 was promulgated making the jahgir inalienable and impartible. Subsequently, the jahgir was alsolished by virtue of a statutory enactment and all the right, title and interest of the jahgir vested in the State Government. The compensation amount awarded was distributed amongst the members of the family of Dewan. In the amount awarded to the branch of the deceased, the deceased had 4/9th share. However, the Assistant Controller treated the entire amount of compensation awarded to the branch of deceased as having passed on his death on the ground that the jahgir was an impartible estate and no other member of his family could claim any interest therein before the deceased's death. On second appeal, the Tribunal held that the compensation amount was a joint family asset and section 7(1) was applicable to it. On reference: HELD The grant of 1807 had been made in absolute terms in favour of Dewan with the object of benefiting him and his descendants. There were no restrictions placed on the mode of enjoyment of the jahgir or in regard to succession to it. There were no restrictions on the powers of alienation. There was also no element of imperishability of the estate in question. Under the Mitakshara law, on the death of Dewan, the jahgir became ancestral estate in the hands of his successors. The grant had been made for the maintenance of the descendants of Dewan. The 1885 Act did not have the effect of…

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